We’re not beating around the bush: your startup needs to hire a bookkeeper. And if we’re being even blunter, bookkeeping for startups from a firm as opposed to an individual bookkeeper. A firm can financially guide you while offering valuable insight about everything from business structure to financing the company, from lines of credit to the best bank for your growing company. In our humble, yet tried and true opinion, ideally, we’d recommend having a bigger company behind you as opposed to an individual bookkeeper. However, if you’re willing to start somewhere, start with a bookkeeper. Here’s why:
Reason 1: They will use your financial history to help you with cash flow planning.
A bookkeeper helps you get a sense of your past as it pertains to your future, and a bookkeeper for startups can help identify future cost buckets. They understand how the future growth or changes your business experiences might impact each of those line items, and they bridge the gap between the future and the past. A great bookkeeper will identify the buckets and define the past for you. Then, they’ll work with you to map out your spending and plan for growth. Often times, entrepreneurs will have a monthly bill, but it will never cross your mind that that bill could potentially grow. Your bookkeeper’s skillset is to identify those buckets, what we like to call our chart of accounts, and put you on the right trajectory for filling those buckets.
Reason 2: They will identify the right accounting system for you…and actually implement it.
This might be our biggest reason for hiring a bookkeeper. It’s imperative that you identify the mission-critical system in your world, whether that be a time reporting system, a project management system, or an operational scheduling system. Once you have that mission-critical system specified, we can identify the accounting systems that integrate well with it. Here, your bookkeeper should have a solid understanding of what accounting systems are available to you and which ones best fit your needs. Some bookkeepers might try to force upon you the system they are most familiar with, versus the one that would actually benefit you. Remember: step one in bookkeeping for small business is to select the right operational systems; step two is to choose the right accounting system that integrates with your chosen operational system.
Reason 3: They will improve your chances of receiving funding and/or having happy stakeholders.
In our experience, you do have a better chance of receiving funding or have happy stakeholders if you think about going through the due diligence process. Think about it like this: let’s say you get a basic diligence question like, “Do you reconcile your bank statements?” Do you know the answer? Would you have to say “no”? Can you answer the question confidently either way? Unless you have a bookkeeper, you’re probably not reconciling your bank statements. Making sure you have everything controlled there is a core need. A bookkeeper will help you do just that. Plus, they will be able to answer those questions for you all while making you feel confident that you do, in fact, have everything captured.
Reason 4: They will inevitably save you time.
Startups are wasting 4-10 hours per month on early stage financial mud. However, perhaps the most common problem we’re seeing is that startups are not spending enough time on their books. Often times, the bookkeeping builds-up and is placed in the “important, but not urgent” category. We know you have a lot on your plate, and everything around you seems to be piling up. Bookkeeping is not only important, it’s necessary. Instead of adding it to your own plate and add more to that urgent category, hiring a bookkeeper will allow that important aspect of your business to be taken care of by a financial specialist. You will save time and energy, and you can rest well knowing it’s covered.
Reason 5: They will enable you to make smarter business decisions.
Bookkeeping offers some of the most valuable data into your business. Imagine a world where you have up-to-date books at your fingertips, so you can make the most informed decisions for your business on a daily basis. You’ll be able to point to specific trends to guide your next steps all while making confident decisions for the future.
So where do you go from here? The easiest way to get started is to offload one step at a time. Our solution is modular which lends itself to exactly that. Start with outsourced bookkeeping and see how you like it. Next, consider adding bill pay or payroll support. Essentially, add more services as you see fit and as you become more comfortable. Our final word is this: you can do your own bookkeeping, but you might miss the forest for the trees. Hand your bookkeeping over to us and watch as the time you spend on accounting becomes not only more manageable but strategic too.